How do I choose the right daily budget in Google Ads?

Anne Buch

December 05, 2018 11:03

Updated

One of the most important aspects for online advertisers to decide on is the size of the advertising budget. To make a wise choice on the final budget amount it’s vital to understand how the monthly and daily budget in Google Ads (previously known as Google AdWords) work. You can always adjust your budget amount through your Cobiro Dashboard based on your personal preferences.

Your monthly budget in Google Ads is automatically calculated by multiplying your daily budget times 30.4 (average number of days per month). This is the maximum amount that Google can charge you, however, your final monthly spend won't necessarily reach that limit.

The purpose of Google Ads is to help you maximize your ROI by showing your ads more often on days when search traffic is higher. On those days, your total daily costs might be up to 2 times higher than your average daily budget. In case you are paying for conversions, your daily costs can exceed 2 times your daily budget. But in the end, you will never be overcharged and pay more than the maximum monthly charging limit. This also applies whenever you change your daily budget in the middle of the month. Your spend for the rest of the month won’t exceed your new average daily budget multiplied by the remaining days in the month.

Essential components of your monthly spend are maximum cost-per-click (max. CPC) and actual CPC. When you start advertising you will need to set a maximum cost-per-click, which is an indicator of the maximum price that you’re willing to pay for a click. However, you’re often charged less, even much less, than your maximum CPC because your actual CPC will always be based on the required minimum bid price to hold your ad position on the Google Search results page.

Deciding on a daily Google Ads budget is a very individual decision. This decision should be aligned with your advertising goals and the average amount that you are willing to spend on a daily basis. Still not sure about your budget? Remember, you can change your budget at any time. If you are not sure you can always start low and increase your budget as you go along.